ACG 2021 Q. 8
Industrial Equipment Supply is a new business. During its first year of operations, credit sales were $ 42 comma 000 and collections of credit sales were $ 35 comma 000. One account, $ 700, was written off. Management uses the agingminusofminusreceivables method to account for bad debts expense and estimated $ 525 as uncollectible at year end. The ending balance of the Allowance for Bad Debts is ________.
$525
What is the acidminustest ratio for a merchant with the following account balances? (Round your answer to two decimal places.) Cash $ 23 comma 000 Shortminusterm investments 44 comma 000 Net current receivables 50 comma 000 Merchandise inventory 95 comma 000 Total current liabilities 280 comma 000
.42
On December 1, 2020, Eagle, Inc. sold machinery to a customer for $ 25 comma 000. The customer could not pay at the time of sale but agreed to pay 9 months later and signed a 9minusmonth note at 8% interest. How much interest revenue was earned for the entire term of the note? (Round any intermediate calculations to two decimal places, and your final answer to the nearest dollar.)
1,500
The following information is from the records of Chicago Photography: Accounts Receivable, December 31, 2019 $ 22 comma 000 (debit) Allowance for Bad Debts, December 31, 2019 prior to adjustment 800 (debit) Net credit sales for 2019 93 comma 000 Accounts written off as uncollectible during 2019 350 Bad debts expense is estimated by the agingminusofminusreceivables method. Management estimates that $ 3 comma 050 of accounts receivable will be uncollectible. Calculate the amount of net accounts receivable after the adjustment for bad debts.
18,950
On January 1, Five Star Services has the following balances: Accounts Receivable $ 26 comma 000 (debit) Bad Debts Expense $ 0 Five Star Services has the following transactions during January: Credit sales of $ 110 comma 000, collections of credit sales of $ 87 comma 000, and writeminusoffs of $ 15 comma 000. Five Star Services uses the direct writeminusoff method. At the end of January, the balance of Accounts Receivable is ________.
34,000
The maturity date for a six-month note issued on January 15 would be ________.
July 15
On July 7, Aminus1 Credit Union loaned $ 450 comma 000 to Bridal Retail Shop on a 90 day, 5% note. What is the maturity date of the note?
October 5
Which of the following statements regarding receivables is correct?
Receivables occur when a business loans money to another party.
The accounts receivable turnover ratio measures ________.
the number of times a company collects the average accounts receivable balance in a year
Two methods of estimating uncollectible receivables are ________.
the aging-of-accounts-receivable method and the percent-of-sales method